What is Transactional Email?

Transactional email emerged as an email category in the late 1990s when e-commerce retailers began sending purchase receipts and shipping notifications via email. It was then solidified as an email category in 2003, when the CAN-SPAM Act exempted “transactional or relationship messages” from the rules and regulations of traditional marketing or commercial emails. So what are some examples of transactional email and what does the transactional email landscape look like today?

Definition

Transactional email by definition is any message in which the primary purpose “facilitates an already agreed-upon transaction or updates a customer about an ongoing transaction.” If the message contains only commercial content, its primary purpose is commercial and it must comply with the requirements of CAN-SPAM. If the message contains only transactional or relationship content, then its primary purpose is to facilitate a relationship established by the transaction. Because of this distinction, transactional email is exempt from most provisions of the CAN-SPAM Act. (To see if this includes unsubscribe links, check out this blog post.)

Transactional Email Today

Today, transactional email includes any email triggered by a user’s interaction with a web application, including signups, password changes, check-ins, notifications, and friend or follower requests. These emails typically contain information a user wants or needs and consequently have the highest open rates across all categories of email. Open rates remain high for transactional email because subscribers expect to receive them and even welcome these messages. A report from Borrell Associates, Inc. and Merkle revealed that 64% of consumers consider transactional emails to be the most valuable messages in their inbox. As a result, transactional email also has benefits that directly result in increased sales—they can yield an average revenue per email that is two to five times greater than bulk email.

Author: Jillian Wohlfarth

As SendGrid's Senior Manager of Content, Jillian is responsible for ensuring that SendGrid provides valuable thought leadership content through the blog, whitepapers, webcasts, case studies, and more. An editor and writer by trade, Jillian considers The Chicago Manual of Style one of her favorite reads.